Iceland’s chief financial regulator sacked and referred to police

Iceland’s financial regulator, the FME, has sacked its director and referred him for police investigation.

The board of directors at the FME has referred director Gunnar Andersen to the police. A statement from the board says that evidence emerged yesterday that Gunnar allegedly broke the rules of his job by availing himself of confidential information from the banking sector in an illegal manner, RÚV reports.

Gunnar was also sacked from his job at the same time. Unnur Gunnarsdóttir, the institution’s chief lawyer, has taken over the job of FME director on a temporary basis.

The statement from the FME board was sent out following a staff meeting this morning. It says the board’s decision was not taken lightly and that the board has inspected the evidence and arguments carefully. The statement says that the conditions for Gunnar to be able to perform his job are no longer valid.

The decision comes after an ongoing spat between Gunnar and his board of directors. The board has previously tried to remove the director for failure to declare subsidiaries in audit reports while he worked at Landsbanki, years before the crash; but his claims that the subsidiaries should not have been included in the reports have since been validated by the bank’s former auditors and lawyers.

In response to the move, the Icelandic Ministry of Economc Affairs made the following statement:

“Regarding the declaration of the Board of Directors of the Financial Supervisory Authority on 1 March, regarding the dismissal of the Authority‘s Director General, the Ministry of Economic Affairs reaffirms its continuing commitment to the organisational and institutional independence of the Authority. It is essential that no disruption will occur in the important operations that the Authority oversees, which pertain to securing a stable and healthy financial system. The Ministry maintains that the Board has done what was needed under the circumstances and reaffirms its confidence in the Board.”